Affiliated Computer reported in-line earnings (and guidance) Thursday night but fell about 2% after-hours. Friday morning it was downgraded by CS First Boston:
Affiliated Computer cut to Underperform from Neutral at CSFB; tgt $48 (ACS) 55.43 : CSFB downgrades ACS to Underperform from Neutral. Firm believes the co faces a challenge in weighing accelerating growth (requires increased investment) against preserving current margins (could stifle growth). As a result, they do not expect the co to resume its historical rev and EPS growth rates in the foreseeable future (longer-term, they believe organic top- and bottom-line growth of closer to 10% is more likely than mid-teens).
(via Briefing.com)
On Friday morning Joey was “thinking about shorting the stock or buying the put options” and wanted me to take a look at the chart. This is another one that isn’t giving what I consider to be a good risk/reward right now. It’s fallen a long way this month without much of a bounce so it’s probably due for some kind of rally, which may very well be a dead-cat bounce. I’d rather try to short it if it bounces and starts to roll over at either the 200-day moving average or its current downtrend line.
